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What is the most tax-efficient withdrawal order in retirement?

Quick answer

The conventional wisdom is to withdraw from taxable accounts first, then tax-deferred (traditional IRA/401k), then tax-free (Roth). However, the optimal order depends on your specific situation, including your tax bracket, RMD timeline, IRMAA thresholds, and state tax treatment. We model multiple scenarios to find your optimal withdrawal sequence.

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Illinois exempts Social Security, IRA distributions, and pensions from state income tax. Federal Roth conversions, QCDs, and bracket management compound those savings over a 25-year retirement.

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